anna: good morning and welcome to "bloomberg markets: european open." i'm anna edwards. the cash traders an hour away. u.s. deaths from the coronavirus reach a quarter million as new york city shuts again. germany's finance minister tells bloomberg containing the virus is critical. tough decisions, eu leaders will attempt to salvage billions in virus relief funds.

france threatens to get out of the rescue plan altogether. 11,000 jobs slashed, the german giant fights for survival. welcome to the program. looking at the futures, reflecting the way the european and u.s. equity markets closed yesterday. futures down in europe, mixed in the u.s., reflecting what we saw yesterday were the u.s. wobbled into the close at the end of the session. new york schools closing seems to be the factor. breaking news, some commentary from astrazeneca in connection phasehase two, not the three news we have been waiting for.

that is expected to come within weeks. this is more detail on the phase two data. they are confirming the vaccine's immune response in older adults, that is crucial considering who is most vulnerable to the virus. "the lancet" is publishing the findings. a lot of stuff we have heard already from phase three trials more advanced than this from other drug companies. it has not been peer-reviewed or in journals. we are getting the phase two study, the efficacy against covid. theoxford study confirms response in older adults is useful information even if it is not the phase three data we are waiting for. let's get back to the markets and look at what we see on the gmm. the chinese equity market is doing ok. a mixed session in asia.

asia wobbling a little bit. an increase of the virus in tokyo, that is a focus for markets, along with the closure .f schools in new york will that be followed by further restrictions? new york is going the way of europe in some senses. we have seen the longest winning streak in asia in some 32 years. sessions.streak 13 that could come to an end. marketsok at where the go next. s&p 500 index futures fluctuate after new york city shut schools because of rising infections. let's get to that conversation with laura cooper, markets live strategist. this is not phase 3 news, just days two extra information. we do have phase 3 news that has

people focused on the medium, but the market can wobble on short-term difficulty fighting the virus. we saw this from the news out of new york. laura: the fact we are seeing competing narratives from markets pricing in the vaccine optimism on clearly a 2021 outlook that is looking more upbeat against the near-term challenges. central banks are warning of the risks in the near term, so markets are struggling for what is the next catalyst for a move higher or lower. we did see new york city announce school closures, we see rising hospitalizations across states. that did shake sentiment. it is not a catalyst to go lower, because there are reports of vaccine progress. it is unclear whether we will

bullish,ext move being or bearish in the near term. anna: it is complicated when you look at your. we have seen the reintroduction of some lockdown measures. i wonder how much that gives us to work with when trying to assess what this will do in the u.s. if we see state-by-state introduction of further lockdown measures. european markets rallied through that. still have managed to stay more focused on the medium-term. laura: there are a number of tailwinds supporting that bullish narrative, despite near-term risks. we did see european equities rally despite the rolling lockdowns, and economic activity

under strain on account of the restrictions. we still have central banks willing to step income us a market expectations are for the buying ine bond december. that is why we are seeing a muted reaction in the treasury market despite stocks coming under pressure. at this stage, stocks are more vulnerable in the u.s. given the relatively frothy evaluations. that could be more of a factor in the near-term. i would not expect a selloff like in march, given the economic impact. it will be or contained this time around. anna: some amongst us might think about exit -- about brexit. i have seen a lot of reporting, surveys suggesting 5% down on

sterling if there is no deal. what are your thoughts on where sterling goes? laura: it is weaker on the fact we are seeing the potential for seeing a no brexit scenario. at this stage, we could see a knee-jerk relief rally in sterling, potentially above the 135 mark, but its capacity to hold those gains is a challenge. the jan brexit -- beyond brexit, we will see trade restrictions regardless of the outcome, and that is not priced into this market. risks are asymmetrically skewed to the downside. if we look at the markets are telling us, it is signaling a 70% probability of a deal by year end. if we do not see that, we will see a sharp knee-jerk downside reaction in sterling, and overlay that with rising

deficits on the back of increased spending. it will be quite a challenging time for sterling, and any upside will be capped. in on bitcoin. i asked our colleague mark cudmore about this. he has taken my question as a market timing signal, which i caution against. interesting that we saw the sharp rally yesterday morning. within the span of less than an hour we saw it quickly unwind. it is a challenging asset in terms of a macro water to forecast, because it is sentiment driven and does not have intrinsic value. in the current environment, it is likely to be the case from consensus that we will see bullish momentum persist, potentially breaking close to 20,000 record mark on the fact

we are seeing a shift to more digital assets by central banks it could provide more of an impulse. we are seeing retail investors find attraction in the crypto of theiven the fact exceptional gains repelled momentum further. but outs of volatility like we saw in the price action. anna: thank you very much, laura cooper. you can get involved in the questions we ask and putting to our markets live team. back, we will get further analysis of what is going on with astrazeneca. results.hase two study what does that mean? what can we expect and hope for in phase 3? we will talk about that next.

this is bloomberg. ♪

>> our goal is to supply up to which could gos, to the united states. for 2021, our goal is 3 billion doses. anna: that was the biontech ceo speaking to bloomberg. let's stick with pharma companies in the fight against covid. the astrazeneca oxford vaccine promotes an immune response in the phase two study published in "the lancet." a phase 3 trial will affect the

efficacy and is expected within weeks. sam fazeli is with us. a lot of times, this is not the phase 3 data but more detail on phase two. what are we learning? announcedally they the publication of the phase two trial in "the lancet." the fact they in thethe vaccine elderly population. they have a group of people in 70 years plus, and that is what is interesting to see. introducebeen able to an immune response in folks, we have not seen that data. we have seen it for pfizer and biontech, and now with

astrazeneca. not hugely surprising. it is a similar pattern with other vaccines. useful to get that data on the older age groups. they are key to the covid story. what about the phase 3 data we have yet to see? what expectation can we have? ofs is a different type vaccine, not messenger rna and what we have seen from biontech and pfizer and moderna. this will be taken, a new tool in the toolkit, because it is a different type of vaccine. situationwe have a where we will not have enough doses if it was just going to be moderna and pfizer for the next three years to vaccinate globally. that is why we need other

vaccines. thatonundrum is, what if efficacy and side effect profile is different? someo we manage that when population is vaccinated with one vaccine and others with the other vaccine? that will take a lot of work to work out. it is good to have options when it comes to medical therapy. indeed, thanks very much, sam fazeli. marketsus with a perspective, equities strategist , claudia panseri. how much upside you think there is for global equities around vaccine news flow. we got news today but it is not the phase 3 trial we are waiting for. what upside is there around the

vaccine news flow? it sounds as if we managed to lose that line. claudia panseri, sorry for that. we will try to get the connection after our next break. eu leaders gear up for what could be a battle with pandemic relief. we will discuss that next. this is bloomberg. ♪

>> this crisis has shown us that global public health is the foundation of the world's prosperity and security. safe vaccines must the available

for all, whoever they are, wherever they are, whatever they can afford. incomele or low countries should be left behind. a global recovery is the only way to reopen our economies, to restart the labor market pair supply chains, and start rebuilding. ons is about capitalizing existing market forces, not fighting them. we need to use our recovery stimulus to invest in the clean and digital technologies of the future. this is the thinking behind europe's 1.8 trillion euro recovery package. you can count on europe to lead the way. von derat was ursula leyen speaking at the new economy forum conference. let's get an update on the big

news stories we are covering a bloomberg this morning. tensions are rising among oil producers, with the united arab emirates floating the idea of leaving opec-plus. it is unclear if this is a warning overproduction levels, or a genuine plan of action. , theboring saudi arabia uae increased output. u.k. and canada are on the brink of signing a new trade deal to replace the existing agreement britain has three e.u. membership. trade between the nations was worth 17 billion pounds. an announcement is expected within days. tokyo is raising is raising as virus alert levels to the highest. new cases hit a record high. the u.s. is facing a new rim milestone with 250,000 deaths. hospitalizations are down but intensive care is falling the most since may.

global news, 24 hours a day, on air and at bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. , equitypanseri strategist, ubs switzerland is still with us. we managed to reestablish the line. i was asking before the break how much upside is there to global stocks from vaccine news? we have had some phase 3 trial data, and phase two from astrazeneca. good morning. we see the vaccine as good news because, not just because it will bring the economy back, but our lives back to normal. the valuation of the stocks is not cheap, but that is due to the big drop in earnings growth in 2020. with the vaccine for next year available, that should bring

rotation andto value rotation that we started seeing two weeks ago. this is positive news for us and the market overall. tokyo might put an end to a long running streak for asian stocks, up for many back-to-back sessions, the longest winning streak since 1988. how do you play asia given the success many parts of asia have had fighting the virus? claudia: the line is breaking, and i did not understand the question. sorry. anna: how are you playing asia at the moment? claudia: we play the recovery. the recovery, we clearly have reference within the euro zone for small and mid-cap. in the u.s. we like mid-cap.

we have some positioning overweight across industrial and in the global sector location. names,clical and value but also with the size. being exposed to small-cap and mid-cap in the euro zone, given the valuation. this is true not only in the euro zone but in the u.s. urszula were hearing vendor line about the importance of the recovery fund, how worried are you about agreement to that recovery fund and getting fiscal stimulus given the disagreements that are currently taking place between hungary and poland and the commission? claudia: this is short-term risk which the market is not focusing on much, but considering the by major countries like germany, france, italy and spain, we shall see something,

which is important considering the current restriction in some countries. there is some risk in the short-term, but for 2021 we will find a solution. the wider market is not focusing on that too much. the solution will be something we will understand. it is a short term risk, but it does not change the picture for 2021 with fiscal support coming through. play the u.k.ou at the moment, given the pivot to green investments and big ,nergy names, big oil companies

and also exposure to financials if value picks up? u.k. is one of the more preferred countries in our asset allocation. the reason why the u.k. is lacking is due to the different element, the u.k. market is missing big tech names. the performance of tech names in 2020. on the others, brexit is waiting in most of the sector in the u.k., despite these sectors exposed locally. we like u.k. and buying u.k. stocks. not so with the currency which we expect to be appreciating in the coming months. we like u.k. market structure, it has a value bias. also industrials. .nna: thank you very much

apologies for the issues with the connection. claudia panseri, equity strategist, ubs switzerland. market, we start with futures. euro stocks point to the downside. ftse futures pointing to the downside. we have to play catch up given the u.s. fell off in there session over concerns over the lockdown measures. u.s. futures look more positive. in other assets, the dollar moves to the upside. 10-year yield at 86 basis points. cable moves to the downside. we are generally risk off when it comes to stocks and fx. up next, we are told that controlling the virus is critical as germans take to the street against lockdown measures. we will talk about the german

fight against covid-19, that is coming up next. ♪

anna: welcome back to "bloomberg markets: european open." 30 minutes ahead of the trading session. euro was the most used currency for global payments last month, the first time the common currency outpaced the dollar since early february 2013. dani burger joins us, why were global payments in euros rather than dollars? dani: has to do with the upheaval of the currency, trade and the economy. ,his data comes from swift

which handles information for 11,000 financial institutions in 200 countries. thingsre three main key that have disrupted the market, leading into what we saw last month, the euro overtaken the dollar. you have trade upheaval in general changing the picture. you also have recession in most countries. and political disharmony especially in the u.s. this creates a picture were the euro gets more news more often. that is seen as well in the price action of the dollar, the volatility falling more than 11% since its march. peak.s march anna: we should make the point that share of international payments, not a share of the funding currency. it does not mean cross-border loans is in euros and not

dollars. how big of a threat is this to the dollar status as a dominant currency? dani: as you put it, the dollar is the currency for the financial world. it is dominant when it comes to the funding currency, and this is just one month. coble trade is dominated by the dollar. -- global trade is dominated by the dollar. it is safer now, but it does not mean it will be safe forever. things about the dollar is that there are alternatives now. the segmentation in the euro zone, those concerns have faded. it makes the euro more attractive. we have a lot of debt from the euro area because of the funding coming from them, the crisis funding. that could start to rival u.s. treasuries. at the same time you have a massive deficit in the u.s., that is not shaking the bond

market. but should it, it will attract more investors to the euro. there are threats, but the dollar does not look to lose its status anytime soon as the reserve currency. thank you very much, dani burger, with all the latest on the euro, the dollar and others. more virus restrictions are overshadowing progress toward a vaccine. berlin is the latest place with protests, with police using water cannons to break up the demonstrations. speaking to bloomberg, the finance minister dismissed the criticisms. >> i think we did well. we acted very fast to the crisis. we decided on a stability program at the beginning of spring. we decided on a recovery program in the summer.

we helped the european union help recover the con ami, and it made it feasible that we had a good development in the economy so far. the rates are lower than in other places. we have to tackle the new second wave. fast. doing it very and with a strong support program for those sectors of the economy that has to do business for the month of november. we understand there is big support in the population. 80%, and that is not too bad. this is how things are in a democracy. most of ther less people are supporting the government strategy. guy: regional courts and leaders

and people in berlin are saying enough is enough. do you think germany can be as effective in the second wave as it was in the first wave containing the virus? containing the virus is critical to the economic outlook. much agree with you that containing the virus is critical. i'm absolutely convinced we can manage the situation as we did in the spring. all the measures we took our showing first results. we are not in a situation whether it further growth of the infection rate, and we hope to get it down with the things we are doing. and for making it more easy for the regional court to support these decisions of the government's in germany and at the federal level.

we are now discussing new legislation in the parliament. it has been passed today and will be supported by the federal council and german legislation. when this happens this week, we can be sure the courts will accept the decisions of the government in germany. you should understand they are not saying it is not allowed to do what we did, they are saying after time, it is necessary to have more complete measures. not just having government action. i'm convinced we will be successful in the health sector again. chancellor ande there was a high probability you might be, what message would you send to the people outside the bundestag protesting without masks?

first, it is the right of anyone to act against government strategies, and good to go out in the streets and say your opinion. but it is good to be cautious and obey the regulations we have. it is not just good for yourself, it is good for any other person you are responsible at all thee look ideas we have saying there should be distance between people, that we should wear when we are in deeper contact with other people. all these things help keep our health. anna: guy johnson speaking to germany's finance minister. let's get to the markets,

european equity markets expected to open weaker. a focus on the virus and on school closures in new york. and a focus on tokyo, raising the alert level. we monitor things through a european perspective. the euro is fairly flat. the dollar is gaining strength. keep an eye on indonesian assets. that is on the back of a surprise rate cut by the indonesian central bank. up next, back to germany. german conglomerate is cutting 11,000 jobs. this is bloomberg. ♪

>> if we are going to rebuild our economy, we truly need a very targeted fiscal stimulus

for those unemployed. we need fiscal stimulus for some i believe ated, and targeted fiscal stimulus will be in order to begin a more equalized economy. that will be essential for the biden administration. blackrock ceo larry fink at the new economy forum about priorities for president-elect joe biden, the need for fiscal stimulus is on his mind. let's look at what we are watching out for today. european union leaders are due to hold an online summit to discuss the latest efforts to contain the coronavirus. governorntral bank faces his first test with the country on the verge of a currency crisis. are also on the subject of central banks, watching for a

decision from the south african central bank, it cut its benchmark by 300 basis points this year. then we get u.s. initial jobless claims. economists estimate that number will come in at 700,000. lots to look ahead to, and also the central banking story. cutting 11,000 jobs, twice as many as last year. the german conglomerate is forecasting a one billion euro loss for the fiscal year, and it's beleaguered steel unit hemorrhages cash. latest, 11,000, why the need to cut more jobs? effects.re hit by two it is a structural problem that is long-lasting.

also obviously corona has hit really hard. they see their money flowing out, and basically are looking for public health. -- public help. anna: other businesses in germany looking for public help from the government. tell me about the strategy they are adopting. from the outside it looks like individual businesses step up and ask for assistance. i wonder what is the criteria for getting that assistance, what picking of winners is the berlin government doing here? >> at the moment they have set up this fund which is due to help any big company suffering from the corona crisis.

you are absolutely right. companies which have structural problems are hit by the corona crisis. there is this debate in germany, should we rescue and intervene in any company. we see at the moment knocks on the door of the government, and looking at whether the government would be ready. travel agents are knocking at the door. says if werty helped, it should be short-term. we should inject a little capital, but then we should get out quickly and not interfere in business. we should not interfere in management. the coalition partner says, if we give money, we should have a say.

anna: i wanted to ask you about that. is it turning into an ideological divide within the german coalition? >> it is. the parties are not on the same page ideologically for a while. now, with these companies and the second wave knocking on the head this is coming to a and will impede and make an agreement on these packages more difficult. they have to settle this ideological divide before things can move on. much.thank you very markets,heck on the euro stoxx 50 futures wanted to the downside all the way through the asian session. we are looking to play catch up with the losses in the u.s. yesterday.

was weaker market yesterday. futures look more mixed. let's get a bloomberg's nest/. chip saless data will decline in the second quarter, orders are falling from a chinese customer the analysts speculate is huawei. the market for data center tech has become one of its largest sources of revenue. deutsche bank is selling 800 million dollars in commercial property loans, according to the documentation, it is the largest offering of its kind since the start of the pandemic. commenting onnot some detail. being sued by female workers who say the company marginalizes, demeans and undervalues women, and

encourages gatherings that strip clubs. it says the estimation is women must choose between having children or their career. pimco denies the allegation. diane tech says the vaccine made in partnership with pfizer with ech says the vexing made in partnership with pfizer -- know that we will submit fridaynd documents on for the fda. submission to the european regulators. this is an ongoing process. >> this is great news for everybody. we want as many vaccines as humanly possible. how do we know if the vaccine

prevents asymptomatic transmission? >> we do not have that information yet. vaccineindicated the should be able to prevent infection. one of the components of the system we are activating is the antibodies. is usingur vaccine -- is utilizing this. this could prevent infection. datall collect indirect showing how well the prevention of infection, but this will be a few months. a long-termere be effect? the antibody response fades, but will there be a t cell response and long-term memory of how to deal with the virus? >> we have evidence for that.

cellse analyzed the t from volunteers who have then vaccinated before and after vaccination. that aftererved is four weeks, the vaccinated people have strong t cell responses. we see two types of t cell responses. [indiscernible] this is an important finding that shows us the t cell responses we are observing is higher than the response observed. we know from other virus infections that can last for many years. we have one component of the newer system with better

stability. ceo: that was the biontech speaking to guy johnson and alix steel. 11 minutes until the start of the equity trading session. up next, we will get your stocks to watch, including norwegian air shuttle as it seeks protection in ireland. we will get details on that. this is bloomberg. ♪

anna: welcome back to "bloomberg markets: european open." eight minutes until the start of cash equity trading. we turn to dani burger with stocks to watch and the lowdown. let's start with the u.k. dani: royal mail's first half

profit did plunge, but it is about the looks forward. online shopping has picked up. for the first time ever revenue from parcels is exceeding that for letters of the royal mail. with the christmas season underway and purchases expected to be online, royal mail sees a more optimistic outlook, seeing revenue growing 23% year-over-year at the high-end. they say it is difficult to give precise guidance because of the coronavirus. parcel growth revenue is giving them some optimism. anna: what about in the aviation sector, news about norwegian and how they want to protect themselves? dani: norwegian air under pressure, they have asked for more government aid and were turned down. they are seeking protection from creditors, filing for something in ireland which is similar to

chapter 11 bankruptcy in the u.s. the court would shield their will try to reorganize within 100 days. the insolvency is real for norwegian air. this will be on investors minds today. lengths governments are going to to bailout aviation companies is very topical. yesterday we talked about air france looking for funds to rescue their balance sheet. involves will shareholders. retail outlets, maybe that is somewhere you want to be right now. dani: yes, shareholders have a lot to say about these companies as well. mall, theyld

previously tried to offer restructuring to their investors, saying they wanted to raise more capital through a shared sale. the ceo is exiting, partly because of pressure from activist investors who turned down his plan to get more liquidity for the company to pay down their debt. the shareholders want them to sell their u.s. assets. with the ceo gone, that process might be what comes next. change thehip might plan that they want to proceed to pay down the growing debt pile. much, dani you very burger, with stocks to watch. astrazeneca could be on the move. it could give the market reason to focus.

kingfisher beat estimates. keep an eye on airspace and defense, on expectations on what boris johnson will do on defense spending. the open is next. this is bloomberg. ♪ businesses today are looking to tomorrow.

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start of cash equities trading. u.s. deaths from the coronavirus reach a quarter million. new york city shuts schools again. a phase two study says the an immunecine gets response from the elderly. phase 3 is expected within weeks. eu leaders will attempt to salvage billions and virus relief funds. hungary and poland threaten to derail the plan. christine lagarde will speak about the ecb covid response imminently.

futures have been projecting we will have to play catch-up with the u.s. yesterday we got news about new york schools closing again. it is a precursor to other closures. that is the big focus for markets. that is one the market is close to. let's see where the european equity markets open. europe is dealing with its own lockdown measures. managing to make gains through that. the stoxx 600 down 0.6%. the ftse 0.6%. the ibex down 1.3%. focus on the asian story, we are seeing in tokyo an increase in the alert level around the virus. that is catching asia's attention. 1%.cac down

unibail is down 1.9%. a mixed bag. .orwegian air shuttle down 10% the european equity markets are opening lower on news of the coronavirus, with u.s. deaths hitting 200 50,000 deaths. astrazeneca will release the results of its phase 3 trial. the astrazeneca share prices are 0.75%. dani burger joins us with a look at these markets and how they are opening up. what is catching your attention? that looks a trend like it will continue to play out. that is the push and pull

between long-term optimism, return to growth, thanks to vaccine news versus the short-term pessimism. when pessimism takes hold, we see a similar pattern with value names turning lower, stocks in europe underperforming, and technology stocks outperform. ist is what investors feel safe, with nasdaq 100 futures doing better today. is that wequestions need the timeframe for when the vaccine is. many see this at the start of next year. we get this oscillation between hope for growth and pessimism with new york schools shutting. i should point out mark mobius said yesterday he does not think markets can go higher. that 2021 will be worse because

the vaccine optimism is already priced into the market. along those lines, days like today were you see european stocks drop could become the norm if you think that vaccine news is included into the prices we are seeing. anna: all the way through this crisis gold has been a strange haven. it is losing its shine. today.seeing it weaker what is your thinking around gold? dani: i want to bring up the etf traders, when you look at what gold is doing, it is dropping today, and it has for the past month, which is a strange phenomenon. days like today that our risk off, why aren't people going to the gold haven? theinvestors have been stalwart and continue to pile into gold. but this month is on track to be

one of the first months of outflows in gold etf's. this has become a dominant part of the metals market, this etf flow. it is costly to store gold. it is easier to go in and buy an etf. gold flows are dominated by what the passive trackers are doing. the etf crowd has capitulated. it could be positive vaccine news or a reversal of the trends, or something more technical. if this crowd is capitulating, it is enough to be a drag on gold even during sessions where if it were textbook risk off you would expect gold to be higher. much, dani you very burger with a quick look at the markets. equity markets opening on the back foot. we are waiting for ecb president christine lagarde to address eu lawmakers.

the focus will be a monetary and fiscal policy measures, and the ecb sponsor the covid-19 outbreak. the text of her speech has been released. lines are starting to appear on the bloomberg terminal. she says eu recovery funds must be operational without delay. policymakers must help the economy. we demand means continued fiscal support is needed. demand means continued fiscal support is needed. about theo is talking fiscal side, saying trade is likely to remain, but governments need to do more and avoid fiscal edges. maria: a lot of messaging for european governments. to gets a perfect day that message to the eu 27,

because european leaders will meet in conference today. talks around the recovery fund have been blocked by hungary and poland. they are trying to veto key aspects of the budget which would have ramifications on the recovery fund, which could be delayed and not operational for the start of 2021. there would be a concern of the flow of money into countries like spain and italy that need that financing would come as scheduled in the second half of the year. hungary and poland signaled they are ready to veto the package. the rest of the european capitals say conditionality around the rule of law is the sticking point, the criteria to make sure judges and the media and the opposition are treated equally is crucial and has to be respected and linked to the payment of the money. this is a tricky issue.

shares the same political family, members of the epb. sayingean official is the issue is serious with no obvious solution. anna: and christine lagarde going further, a redhead line on the bloomberg, the eu spending must be operational without delay. firm words from the ecb president, as we read through what she is about to say to the european parliament. we are waiting for christine lagarde to speak. remind us how europe is trying to get around the disagreements with hungary and poland. the french had an innovative solution. maria: as many ideas that have been floated, one is that hungary and poland that money out of this.

the messages to wait to december for everyone to cool down, and there will be a deal. the french floated an idea that is hard to conceive, in which the 25 countries that want the recovery fund, the coalition of the willing, could cut a deal among themselves that would exclude hungary and poland, but would note the value of the deal presented at the table is it is .greed by unanimity they have to agree on all of it, so it is difficult to see how you implement a 25 member state solution in a short amount of time, and the implication it would have on the other countries with the money they pay in and get back. at this point it is a solution that is hard to implement. about --e gas talk some guests talk about hungary and poland and that they are set to be big beneficiaries of

bailout funds. some assume that thinking will knock heads together and result in a deal, some compromise. others are looking ahead and saying, how is this going to disrupt other business in brussels? 2030 climate goals could get pushed out. brexit talks as well. any thoughts? maria: there is a lot on spending, there is no resolution on the climate target. you also have brexit trade talks coming to an end. this is pending with no clear resolution. poland and hungary benefit from this package and get a lot of money. they are beneficiaries from it. i am reminded that this is about politics and ideology. they believe they are fighting a liberal order of the world, and

if you ask other capitals, they do not agree with the message he takes act home -- takes back home. anna: thank you very much, maria tadeo joining us from brussels. we are waiting for christine lagarde to speak. we have some of the lines, the spending package must be operational without delay. a clear message from the ecb president and her remarks to the european parliament on the subject of fiscal support. she has strong views on that. it is being delayed because of disagreements around the rule of law. let's check in on share prices as we wait for christine lagarde to take the stage. astrazeneca up 0.8%. details this morning from astrazeneca and oxford around their trials of the covid vaccine, but it was not phase 3

data. what we have heard is they will release phase 3 data and results in a few weeks. that perhaps is enough for markets to go higher on astrazeneca. positive news surrounding the phase two trials and how they help elderly patients. let's check in with t thyssenkrupp, they will cut more jobs than had been anticipated. we see that go to the downside. norwegian air shuttle, not a large business but an interesting conversation around aviation. down 16% this morning. a very volatile business. are looking for credit protection in ireland.

in terms of the overall market picture, european equity markets moving to the downside 0.7%. it is all mixed, we do not have any markets standing out. the ftse 100 down 0.6%. ax down.and d u.s. futures look fairly flat. yesterday we saw equity markets moving to the downside as a result on the headlines of the closure of new york schools. what does that mean about wider closure activity in various u.s. states? we are still waiting for christine lagarde to speak at the european parliament. we will take a short break. this is bloomberg. ♪

>> this is clearly what we are facing at the moment, which makes our job incredibly challenging. let's look at the economic outlook. monetary policy and uncertainty in that context. vaccinest news on the looks very encouraging. the recent surge in coronavirus cases and the associated positioning of containment

measures are adding to the already heightened level of uncertainty and presents a serious challenge to the euro area and global economy at large. partialg a strong but uneven rebound in real gdp growth in the third quarter, latest surveys and high-frequency indicators, the euro area economic activity lost momentum going into the fourth quarter. the resurgence in covid-19 infections is weighing on the service sector activity. reasons we cannot think of, but it is especially vulnerable to the mandatory social distancing measures that were introduced. the purchasing managers index, the pmi for the euro area shows while manufacturing output

continued to improve, service sector activity weakened further in october. this uneven impact is evident across euro area countries, with those countries dependent on tourism and travel affected the most. so far, government support measures, particularly short term work schemes have protected households against job losses, and a drop in income. preventedot unemployment from spiking in some countries. in addition, consumers are expected to remain cautious in the current highly uncertain environment, as the ramifications of the pandemic are threatening income prospects. in turn, subdued demand and the weakening of balance sheets and

profitability are weighing on business investment. companies are likely to remain hesitant about committing funds to long-term investments, as long as there is high uncertainty on how the pandemic will unfold, as well as the possible rollout of a successful vaccine. overall, the euro area economy is expected to be severely affected by the fallout from the rapid increase in infections, and the reinstatement of containment measures. a clear downside risk or the near term economic outlook. the weakness in economic activity from the onset of the pandemic is reflected in inflation developments. low energy prices and the temporary reduction in german value added tax are dampening

inflation. weak demand and troubled sectors, and significance in the labor markets are adding further downward pressure. in this environment, we expect the headline inflation is likely to stay in negative territory until early 2021. the cure-all of monetary policy in this situation is to preserve favorable financing conditions for all sectors and jurisdictions across the euro area, as a result providing safeguardingrt and medium-term price stability. when thinking about favorable financing conditions, what matters is not only the level of financing conditions, but the duration of policy support too.

in this regard, preserving favorable financing conditions for as long as needed is key to support people spending, to keep credit flowing, and to discourage mass layoffs. i announced at our october meeting, over the coming weeks the governing council will carefully assess the incoming information, including euro system macroeconomic projections in december. these projections will enhance our formation set and allow a thorough reassessment of the economic outlook, and the balance of risk. on the basis of this updated assessment, the governing council will recalibrate its instruments as appropriate to respond to the unfolding situation, with a view to

fostering convergence of inflation toward our aim in a sustained manner in line with our commitment to symmetry. while all options are on the table, the pandemic emergency purchase program that many of you know under the name of pep, and our targeted long-term refinancing operations, known as teltros have proven their effectiveness in the current environment and can be dynamically adjusted to react to how the pandemic evolves. they are therefore likely to remain the main tools for adjusting our monetary policy. promptly and forcefully for the first wave that hit the euro area economies by designing new tools specifically tailored to the nature of the shock, and

recalibrating are well diversified portfolio of existing instruments. our measures have been very successful stabilizing financial markets, and underpinning economic to be, thereby helping offset the downward impact of the pandemic on the projected path of inflation. we will address the current phase of the crisis with the same approach and the same determination. let me turn to the second topic you have selected, the nexus between fiscal and monetary policy. the crisis responds so far as powerfully illustrated how monetary and fiscal policy can be mutually reinforcing in the current circumstances. monetary policy, as i have argued above, it is crucial to

ensure favorable financing conditions for the whole economy. at the same time, fiscal policy has a primary role to play in bolstering demand in the short and medium-term, reinforcing confidence, and enhancing the growth potential of our economies. role forlicy has this three key reasons, in my view. the stimulus needed to arrive quickly. fiscal policy has an important sectoral dimension for which monetary policy is not the right instrument. tools some of the policy credit guarantees our inherently fiscal by nature. euro governments have implemented fiscal measures amounting to more than 4% of

euro area gdp in 2020 alone. these measures are in addition to the liquidity support initiatives and the operation of automatic stabilizers. the national fiscal responses have been highly effective. job retention and low guarantee schemes helped secure employment and prevent the unnecessary loss of viable businesses. they have been crucially complemented by eu level support, the so-called safety net that reinforced confidence and enhanced effects. by propping up demand facilitating access to credit for companies, these measures have reinforced the effectiveness of our monetary policy. while the fiscal measures taken in response to the pandemic should as much as possible be

targeted and temporary in nature, we demand in the heightened risk of a delayed recovery, warrant continued support from national fiscal policy. coordinated and fiscal stance remains critical, and we should by all means avoid trace effects. positivelystment can affect economy growth in the current circumstances. in an environment of accommodative monetary policy, public investment have the strongest short-term demand effects, including in terms of cross-country spillovers. moreover, in times of elevated uncertainty, public investment raises confidence and tends to have a higher fiscal multiplier. by raising confidence, a push in public investment is likely to foster investment from private

stakeholders. at the same time, we should not forget the longer-term positive effects on the economy potential output, and on public finances, crucially depend on the effectiveness of investment and productivity of public capital. public investment and reforms are geared toward medium and longer-term challenges such as environmental sustainability can build a bridge toward a successful inclusive recovery. thehould not think about two in isolation. combining reforms and investment led stimulus has the potential to raise growth even more. together -- aboutnext, we will talk

the fight against coronavirus. vaccine promotes an immune response in the elderly. it is not phase 3 data. more on that next. this is bloomberg. ♪ businesses today are looking to tomorrow.

adapting. innovating. setting the course. but new ways of working demand a new type of network. one that's more than just fast. you need flexibility- to work from anywhere. and manage from everywhere. advanced technology. with serious security. and reliable coverage, nationwide. forward-thinking enterprises, deserve forward-thinking solutions. and that's what we deliver. so bounce forward, with comcast business. anna: welcome back to "bloomberg

markets: european open." 30 minutes into a trading day that looks negative. at theuities were weaker end of the trading day, so europe plays catch up, down 0.7% on the stoxx 600. we heard from christine lagarde at the ecb, interesting lines at the committee for economic and monetary affairs in the european parliament. she talked about the need to get the fiscal side in order. eu leaders must make joint stimulus operational without delay. eu leaders will meet to discuss

how they manage to engrave to conditionality. she also focused on monetary policy. christine lagarde sang the ecb -- saying the ecb response will december.l in christine lagarde still present at the briefing, answering questions from members of the european parliament. let's get a first word update. the united arab emirates privately floating the idea of leaving opec-plus. it is unclear if it is a warning overproduction levels, or a plan of action. friction with neighboring saudi arabia since the summer when the uae increased output over its opec quota. the u.k. and canada are on the brink of signing a new trade deal to replace the existing agreement britain has three e.u. membership.

trade between the nations was worth 17 billion pounds. an announcement is expected within days. australia will not compromise after beijing ramped up criticism of the government. china is outlining 14 grievances, accusing the nation of poisoning bilateral relations. tensions have been splitting sense prime minister morrison led calls for an inquiry into the outbreak. china has hit the nation with crippling tariffs. global news, 24 hours a day, on air and at bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. let's return to one of our top stories, the news around astrazeneca, a vaccine provokes an immune response in the elderly. this is data from phase two of the trial, published in "the lancet." a phase 3 trial is expected within weeks. assess.li joins us to

bang we arethe big waiting for, is the phase three results. what are you reading about in terms of the phase two data? what does it reveal? sam: what is nice to see is the fact they show a similar immune response to the vaccine in the older population than the younger population. that is pleasing to see. box it had not ticked before. we have seen similar data. an immuneto cause response in elderly people.

the only company we have seen that with is moderna. when it comes to comparing these, we should stop and say it is good to see it works in older people. we will be looking for the phase three results in the coming week. we got further details from pfizer, they have details on phase 3, and their plans from here. what were the details we got? is what wee have heard from astrazeneca, it can induce an immune response. pfizer has completed that part of their phase three trial, and shown in their data set that it works in 95% of people preventing disease. more crucially in 94% over the age of 65. that is good data.

tolerability was better than with moderna so far. anna: in terms of safety, pfizer and biontech say no significant safety issues which included 44,000 participants. bear in mind a large scale of these trials, even if they have not been running that long. forgetsolutely, people they worry that it has only been tested in a few people. by the end of the process, somewhere like 50,000 people will have been through clinical trials. is a good database across all vaccines to look at. we will have that information and data by the end of the first

quarter and middle of next year. anna: thank you very much. sam fazeli joining us. stick around. coming up, we will be joined by the editor of "the lancet." don't miss that interview at 9:00 a.m. london time. the u.k. and canada are on the brink of signing a new trade deal. we will bring you the latest on that conversation, next. bloomberg. ♪

>> if we are going to rebuild our economy, we need a targeted fiscal stimulus for those unemployed. we need a fiscal stimulus for some cities most impacted. i believe a targeted fiscal stimulus is going to be in order to begin a more equalized economy. that will be essential for a biden administration. anna: blackrock ceo, larry fink, laying out what he think the priorities for president-elect joe biden should be when he takes office on the fiscal side of things. with biden's focus on climate change, the new administration will be positive to companies

committed to fighting the climate crisis. >> it is my profound belief that purpose and sustainability have better financial purpose, there is no trade-off. we see money invested in green stimulus seems to generate than stimulus packages. it is the most important mindset to break, the trade-off between a green recovery and economic prosperity. a lot of companies have put out targets. how much will that trend easier under president joe biden? >> i think this change, like all system changes, will require collaboration between governments, companies and investors, and this government's

role to set the policies and framework in which we operate. i would like to congratulate the british chancellor who set out the requirement for carbon disclosure in reporting. companies have to drive innovation that will be needed to invent a green recovery. the capital markets and investors need to invest properly in sustainable and green businesses. in that regard, and administration in the biggest economy in the world that reenters the climate change debate and green recovery will be good for the system. francine: unless these disclosures, carbon emissions, are disclosed and mandatory across the world, will it make enough difference to make a meaningful impact to reverse climate change? >> i think the things governments have to do are important, and disclosure is an

important part to it. it can have unintended consequences. the most important thing the government needs to do is get a price on carbon, whether it is cap in trade mechanisms or a carbon tax. there is a role for disclosure and labeling, but the most important step governments can take is to get a price on carbon. francine: how much work at unilever do you do on technologies for packaging or containers that are recyclable and less pollutant? >> most technologies for a green recovery have been invented. low carbon energy. in scotland 90% of their energy comes from renewable sources. plenty of wind not a lot of solar. low carbon transport. all of that exists. now is a good time to invest in

it with low interest rates and the desperate need for jobs. anna: that was unilever ceo, alan jope, speaking to francine lacqua. interesting to hear him talk about carbon pricing. we spoke to him earlier in the week on the focus on that. what we are hearing from christine lagarde, she is still speaking to the monetary affairs committee at the european parliament. she is answering questions from the european parliament. a big message was on the fiscal side, the eu spending package must be operational without delay -- this is in connection with the recovery fund that seems to have stalled because of tensions east-west with conditionality attached to it. some coming through with the questioning, she says the tech, the monetary policy tool to fight the coronavirus fallout was targeted to be temporary.

she said earlier that it looked like tltro's would stay around a little longer, and she is considered about the target and whether there could be a technical failure. it is a payment system, one of the largest payment systems, more than 1000 banks use it for transactions in europe. the u.k. and canada are on the brink of signing a new trade deal to replace the existing agreement britain has through e.u. membership. an announcement is expected within days. joining us now is the reporter behind this. how significant is a u.k.-canada trade deal? big.it is pretty the u.k. and canada, the largest trading partner globally. the trade is worth about 20

billion pounds in 2019. a lot will be covered by this deal. the danger was they could not do this deal and tariff would apply on january 1. they already have a deal through e.u. membership. johnson, andin for as to his narrative that britain can do trade deal's outside the eu. what about negotiations? 14 other eu agreements are taking that eu law and getting it into u.k. law by january 1. are majorthey countries like mexico, singapore, turkey. the trade combined of those agreements comes to 60 billion pounds worth.

an important deal that needs to be done, time is running out. the labour party was saying they did not have enough time to scrutinize the deal. but they areout, confident most will get done. mexico is perhaps in the balance, as is turkey. anna: how do these deals impact on the u.k.-eu negotiations, if at all? joe: i would not read much into the implication, it is a conference boost for the u.k. -- confidence boost for the u.k. if they know they have other trade agreements in the bag and did not have these deals, it would add the impact of a negative impact in january.

a u.k.-eu deal is advantageous in an economic sense. will johnson go for it or decide a no deal is better? anna: just how skinny will that deal be? we could get a lot of trade news from the u.k. and good that maple syrup will not get more expensive. think you for joining us, joe mays with a look at the u.k.-canada trade deal that seems to be in the offing. here are today's top corporate stories. thyssenkrupp is cutting 11,000 jobs, twice as many as planned. it is forecasting a one billion loss for the year as the industrial conglomerate fights for survival. continues toiness hemorrhage cash. is seekingir shuttle

credit protection in ireland after a surge in coronavirus cases scuttled hopes for an early recovery. profits have proved elusive, and it was trying to rein in debt. the norwegian government refused a second bailout earlier this month. chip sales will decline in the fourth quarter, a chinese customer is speculated to be huawei. they are known for their gaming processes and has become one of the largest sources of revenue. that is your bloomberg business flash. up next, the pound may rally 5% against the dollar on the brexit trade deal. we will discuss that, next. this is bloomberg. ♪

anna: welcome back to "bloomberg markets: european open." we are 51 minutes into the trading day. down 0.9% on the european market. we are following comments from christine lagarde at the european parliament, her message on the fiscal side, the eu spending package recovery fund must be operational without delay. she has gone on to say the ecb

has delivered in the first wave, and will continue to. she is taking questions from european policymakers. joins us.trategist is there anything around the christine lagarde q&a that has you changing your thinking? was a strong dollar story going on. there has not been much reaction to christine lagarde's statement this morning. this is the third time this week she has spoken, and she has been reiterating the message from the october meeting. bazooka one big where we should expect big changes in terms of the envelope,of the ppp

and that seems to be reiterated over and over again. side of things need to add up, so i am not surprised by what she is saying. anna: she is saying at the european parliament, she promised a forceful monetary stimulus package for december. did the market expect that already? and she has gone out of her way to say it is not just the size of the package the ecb delivers, but the longevity. is that part of the markets thinking? >> yes, it is very much part of the market paradigm for a while now. they previously expressed an opinion that they are in favor of extending the ppp and amount

of purchases and the longevity of the program. it has been working so well for the market. tumult indays of the march, bunds have come a long way. it is supportive of bonds in particular. the ecb likes what it sees, therefore they have every reason to continue with the program for longer than expected. that will prove supportive. talk about the pound. it is weaker today, down 0.5%, but above 1.32. you have been writing a piece about how the pound could strengthen on a brexit trade deal. a survey of strategists suggested the pound could weaken around 5% on a no deal. that is a range of movement, 5%

down or up depending on a dealer not. ven: it very much appears that would be the range. the pound conventionally had a strong negative correlation with moves on the dollar, given that the dollar has fallen 4% this year, the pound ought to have rallied 5% given the data to changes in the dollar. however, that has not happened, and the pound is flat on the year. that suggests the currency is held down on uncertainty whether or not we will get a post-brexit transition deal. so many twists and turns the story, but if we get that, the pound rally that has been held down 5% against the dollar. on the other hand, as surveys show, if we don't get a deal, it 1.25 against.27 or

the dollar. anna: thank you so much, ven ram. let's close out the hour with a look at the markets, down 0.9%. the value sectors are leading us down with european stocks dropping as rising restrictions overcome promising vaccine news. the vaccine news was admittedly backward looking, it was phase two data, not the phase 3 data from astrazeneca, although that will come in coming weeks. european equity markets on the 0.9%.oot, down u.s. futures are worsening, down 0.5%. looking at the latest lines, christine lagarde's briefing to the european parliament, she is still taking questions from european lawmakers. her statement focused on the monetary side, the role of pep

and tltro's, and the need to get the recovery fund. she is taking questions from lawmakers and says the ecb delivered in the first virus wave, and will continue. you can watch her on live go if you have a terminal. this is bloomberg. ♪

francine: the vaccine raise. the phase 2 study confirms the immune response in the elderly patients. a phase 3 trial expected within weeks. new york city shuts schools once again. the country surges and cases from coast-to-coast. eu leaders will attempt to salvage billions in virus relief today. hungary and poland threatened to derail it.